NATURE OF SUBSIDY ::
Last updated: 28 August 2007
Court :
TRIBUNAL
Brief :
Purpose of the Subsidy is important to determine whether it is revenue or capital
Citation :
JCIT Vs Swastika Agroils P. Ltd
Nature of Subsidy
J.C.I.T Vs. Swastika Agroils (P.) Ltd.
IT APPEAL NO. 426 (CHD.) OF 2000
Case Fact: Whether A.O. is justified in treating govt. subsidy as revenue receipt on ground that such subsidy was to be received only after 60 days of commencement of business.
Decision: Held that since subsidy was granted for setting up industry and to meet cost of capital expenditure, it was a capital subsidy. Hence, A.O. is not justified in treating subsidy as revenue receipt merely because it was to be received after 60 days of commencement of business.
CA.Saibaburao Nanduri
Published in Income Tax
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